G e n u i n e P a r t s C o m p a n y
I n v e s t o r P r e s e n t a t i o n
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
Safe Harbor Statement
2
Some of the comments made and information contained in our presentation will be
forward-looking statements within the meaning of the Private Securities Litigation
Reform Act of 1995. These statements include projections of revenue, earnings, capital
structure, and other financial items; statements on the plans and objectives of the
Company and its management; statements of future economic performance and
assumptions underlying the statements regarding the Company and its business. These
are based on current information and the beliefs and expectations of the Company but
are subject to various risks and uncertainties that could cause the Company's actual
results to differ materially from the Company’s expectations. These include, among
other things, the Company’s ability to successfully implement its business initiatives and
integrate its acquisitions in each of its business segments, slowing demand for the
Company’s products, changes in general economic conditions, including,
unemployment, inflation or deflation, changes in tax policies, changes in energy costs,
uncertain credit markets and other macro-economic conditions, the ability to maintain
favorable vendor arrangements and relationships, disruptions in our vendors’ operations,
competitive product, service and pricing pressures, the uncertainties and costs of
litigation, as well as other risks and uncertainties described in the Company's latest SEC
filings. The statements speak only as of the date on which they are made and the
Company assumes no obligation to update any forward-looking statements made during
this presentation or in these materials except as required by law.
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
Investment Highlights
Leading global distributor in diversified end
markets
Proven track record of steady growth
Strong balance sheet with meaningful free
cash flow generation
Committed to maximizing shareholder value
Opportunity for market share growth in large
and fragmented industries
Large customer base built upon
long-standing relationships 3
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
- Company Overview -Celebrating 90 Years!
Founded in 1928
Leading distributor to
three primary end-
markets:
- Automotive Parts (APG)
- Industrial Parts Group (Motion &
EIS)
- Business Products (S.P.
Richards)
Critical partner to
our customers:
- Best in class operating and
distribution efficiencies
- Industry leading coverage of
consumable/replacement items
- Outstanding just-in-time service
- Technology solutions
2017 Annual Sales $16.3 Billion
4
10%
57%
33%
75%
9.5%
8%7%
.5%
2018 Projected Sales $18+ Billion
12%
53%
35%
81%
7%
1%
2%
9%
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
Portfolio Optimization
Global Presence with Significant Brand Strength
Financial Strength with Access to Capital and Low Cost of
Capital
Enhanced Global Buying Power for Direct and Indirect Spend
- Global sourcing, common suppliers and providers, volume/scale
Common Distribution Processes
- Shared talent, practices, technology & systems, services, transportation
In 2018:
- EIS combined into Motion Industries
- GPC entered into agreement to spin-off Business Products Group (S.P.
Richards) and combine it with Essendant
5
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
Track Record of Success
Strong history of sales & profit growth
- Sales have increased in 85 of 90 year history
- Profit has increased in 74 of 90 year history
Dividend growth
- 2018 marks GPC’s 62nd consecutive year of dividend increases
6
1925 1928 1948 1968 1975 1976 1998 1999 20182013
IPOEstablished Traded On
NYSE: GPC
Founded
Acquired
Acquired
Acquired
Acquired
Acquired
2017
Acquired
35%
Ownership
Acquired
Combined EIS
into Motion
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
Ten Year Sales & Earnings History
5.0
7.0
9.0
11.0
13.0
15.0
17.0
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
+9.0%
$ Billions
EPS
-2%EPS
-14%EPS
+20%EPS
+19%EPS
+16%EPS
+6%EPS
+10%*EPS
+0.4%EPS
-0.9%
+6.3%
+1.6%
-8.7%+11.4%
+11.2%+4.5%
+8.2%
Record Sales and Earnings per Share in 7 of last 10 Years*
7* Comparative Results
-0.4%
EPS
+3%*
+0.4%
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
Automotive Parts Group Highlights
Largest global auto parts network
2017 Sales at $8.7 billion; 2018 sales est. at $10.5B
- US: 57 DC’s & ~ 6,000 NAPA stores (~1,150 Co. owned)
- Canada:12 DC’s & ~ 700 NAPA stores (~200 Co. owned)
- Mexico: 12 DC’s & 42 NAPA stores
- Balkamp: Parts Re-Packager
- Rayloc: Brake Products Distributor
- Altrom: OE Import Parts
- Heavy Vehicle Parts Group: Class 6,7,8 trucks
47 DC’s & 2,000+ Store Footprint in U.K., France,
Germany, & Poland via Alliance Automotive Group
12 DC’s & 560 Store footprint in Australia and
New Zealand via Repco & other banners
Superior brand recognition & customer service
Globally positioned to benefit from positive
industry trends 8
Automotive
57%
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
Quarterly Sales History
$-
$0.25
$0.50
$0.75
$1.00
$1.25
$1.50
$1.75
$2.00
$2.25
$2.50
$2.75
-0-
-2%
2016: +1%
Sales
Billions
+2%
+3%
+22%+23%+25%
+22%+5% +4% -0-
2015: -1%
(+4% ex Fx)
-2% +3%-1%
+2%+1%
2017: +6%
+4%
9
+4%+11%
+4%
+28%
2013: +18.5% 2014: +8%
YTD 2018
+29%
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
United States$100B
Canada$9B
Mexico$6B
Australasia$7B
Europe$82B
The Global Automotive Aftermarket
10
$200B Global Market - Large, Fragmented, and Growing
CountryMarket
Share
Industry
Growth
United States 7.5% +2%
Europe* 5% +2%
Canada 14% +3%
Australasia 20% +2%
Mexico 2% +6%
Total 7.5% +2%
*Reflects France, U.K., Germany, and Poland
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
NA Automotive Parts Group OverviewNAPA Established 1925
(90%) NAPA branded products
NAPA Know How Differentiators:
- Product quality, depth and breadth
- Trained personnel/service capabilities
- Technology offering
Commercial/DIFM customers
- Professional service repair facilities
- Approx. 75% of NAPA sales
17,000+ NAPA U.S. AutoCare Centers
- 1,600+ in Canada (& 600+ AutoPro Centers)
Major Accounts: AAA, Goodyear,
Firestone, TBC, CBAdvantage
Retail/DIY customers
- Individual consumer customer
- Approx. 25% of NAPA sales
Major Competitors
U.S. - AutoZone, Advance Auto Parts, O’Reilly
Canada - Uni-Select, AAP/Carquest
Mexico - AutoZone
Major Account Customers
11
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
U.S. Vehicle Fleet Trends
$0
$200
$400
$600
$800
$1,000
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15+
$403$484
$573$644 $671
$741 $776 $829 $868 $861 $873$857
$776 $802 $812
An
nu
al
Sp
en
d p
er
Veh
icle
Vehicle Age
Consumers Are Maintaining Older Vehicles
12
Prime Years for Aftermarket Repair
Start in Year 6
Vehicles 6+
Years of Age
>70% of Fleet
Avg. Repair
Cost/Year
1-5 Yr = $555
6-12 Yr = $829
> 12 Yr = $797
Source: IMR, Inc. Automotive Research, BB&T
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
Fundamentally StrongAftermarket in U.S.
Total vehicle fleet growing
+1 to 2%
thru 2020
11.7 Years
$2.97/GL
At June 2018
+1.2% in 2017
+0.3% thru May
2018
Average age of fleet increasing
Generally lower gas prices
Miles driven reaching new peaks
13
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
NAPA Retail Store
14
Before
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
NAPA Retail Store – New Store Concept
15
After U.S. company-owned store rollout to be
completed in 2018
Retail sales for these stores > company
average
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
NAPA AutoCare Centers
16
The Aftermarket’s Preeminent Commercial Program
for the Independent Repair Center
Before
NAPA AutoCare
17,500 in U.S.
1,648 in Canada
NAPA AUTOPRO
623 in Canada
After
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
Alliance Automotive GroupAcquired November 2017
Leading European distributor of vehicle
parts, tools, and workshop equipment
Focused on light vehicle and commercial
vehicle replacement parts
A leading European player in attractive
markets with strong fundamentals and
growth potential:
- #1 in France
- #2 in the U.K.
- #3 in Germany
Announced acquisition of Hennig Fahrzeugteile
Group in June 2018 – Effective October 2018
(31 locations and $190M US$ in annual revenues)
- Entered into Poland in Q4 2017 through
acquisition of majority stake in Groupauto Polska
Integrated distribution model similar to
GPC
Allows GPC to leverage global supplier
base across businesses
- ~$25M in annual synergies
% Revenue by country1
2017 Key Figures (USD)1
36%
14%
50%
US GAAP
Revenue
$1.7bn
47 Distribution
centers
500+ Suppliers 363 Owned outlets8,000+ Employees
1,669 Affiliated
outlets40,000+ Customers
171 2017 USD / EUR of 1.202 Includes supplier direct billing, which are accounted for “Net” under U.S. GAAP
Gross
Billings
$2.3bn2
2,032 Total
Outlets
Serves 4,000+ repair centers under leading
commercial programs, including the Top Garage,
Auto Care and Precisium Garage banners
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
€8.9bn
€8.5bn
Aftermarket
size split per
country48%
European Automotive Aftermarket
European LV market per country at distribution level
AAG operates in the largest and most attractive
European marketsTOTAL EUROPEAN AFTERMARKET
€68bn1
Germany
France
U.K.
Poland
France2 U.K.2 Germany2
Car parc size (m, LV) 38.3 35.6 47.9
Car parc age (years, PC) 8.9 7.6 9.3
Mileage (km per year, LV) 13,400 13,400 14,300
Annual spend per car3
(retail price, €, PC)390 385 470
Overview of European LV aftermarket at distribution level
Source: Roland Berger1 LV parts (tires included) plus tools and equipment, captive parts excluded, in EU's 28 countries; 2 Stats relate to 2016; 3 Parts only 4 Independent Aftermarket (“IAM”); IAM represents approx. 48% of total LV aftermarket in France, U.K., and Germany combined
18
Car parc size
Car parc age
Total traffic
Technological
developments
IAM4 gaining share
over OES segment
Favorable regulation
Long-term growth drivers
€14.0bn
€4.0bn
20%
Other
countries13%
13%
6%
52%
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
€ 100m
€ 2,000m
ROMANIA
POLAND
HUNGAR
Y
SLOVAKI
AAUSTRIA
CZECH REP.
BULGARIA
GREECE
SLOVENIA
CROATIA
SERBIA
BOSNIA
MONTENEGRO
ALBANIA
MACEDONIA
DENMAR
K
SWEDEN
€ 1,350m
€ 600m
€ 900m
NORMAY
€ 3,950m
€ 500m
€ 1,400m
€ 600m (25% )
Top 3 position in the largest European markets with significant opportunities for growth
19
AAG’s Banners by Country
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
GPC Asia Pacific Acquired 2013
Market Share Leader in Australia
and New Zealand
- 560 Company-owned stores
- Added ~60 stores since 2015
Primary Banners
20
Major Competitors
Supercheap, Burson, &
autoBarn
Repair Center Commercial Program466 Repco-Authorized Service Centers
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
USA $6.2B 57 6,000
Europe $1.9B 47 2,000
Canada $1.1B 12 700
Australasia $1.2B 12 600
Mexico $100M 12 42
140 9,342
Global Leader in the Aftermarket
2018 Est. DCs Stores
21
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
Growth Opportunities
Key Areas of Focus Initiatives
New Distribution
• Plans for new NAPA AUTO PARTS stores in U.S., Canada,
and Mexico
• Alliance Automotive Group expansion in Europe
• Store expansion in Australia and New Zealand
Commercial Programs
• Continued Enhancements and Expansion of Global
Commercial Programs for Independent Repair Centers
• NAPA AutoCare, AUTOPRO, RAS, Top Garage, Precisium
Garage, Groupauto AutoCare
Major Accounts • Further Expansion of Major Account Customer Sales
Outside Sales • Additional Outside Sales Representation at Stores
Connectivity • Enhanced Installer Connectivity and Capabilities
Special Markets • Heavy Duty Parts, Import Parts, Paint, Tools & Equipment
Store Resets & Upgrades
• Retail Sales Initiatives
• Impact Store Initiative in U.S. and Canada
• Ongoing Programs to Refresh and Upgrade All Stores 22
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
Industrial Parts Group
Motion Industries Highlights Leading industrial parts MRO
distributor in North America
2017 Sales at $5.7 billion; 2018 sales est. $6B+
- 14 MI DC’s and 540+ branches and service
centers in the U.S., Canada and Mexico
- 44 EIS locations across North America
Proven track record with over 70
years in the industry
Access to over 7.1 million products
- Global manufacturing base
Very large and fragmented industry
Efficient supply chain and vendor partnerships
High customer service levels & tech support
Industry leading E-Business capabilities
Founded 1946
Acquired 1976
23
+ = OPPORTUNITY
Industrial
33%(4%)
(29%)
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
Quarterly Sales History
$400
$600
$800
$1,000
$1,200
$1,400
$1,600
-7%
Sales
Millions
2013 -1% 2014 +10%
2018 +8.5%
-2%-1% -3%
+3%
+7%
+10% +13%+3%
24
+12% -1%
-3%+4%-2%
+6%
2016 -1%
-2%
+8%
2017 +7%
-3%
+7%+6%
Updated for Motion and EIS Combination
+9%
+8%
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
Suppliers: SKF, Baldor, Gates, Rexnord, Timken, Eaton and 3M
Customers represent all industry groups, including Equipment & Machinery, Food Products, Iron & Steel, Pulp & Paper and Mining & Aggregate
Overview
Industrial Sales by Product
Category
Bearings & Power
Transmission
31%
Industrial & Safety
14%
Other
6%Seals, Pumps
& Hose
7%
Electrical Specialties
Group
14%
Electrical & Automation
9%
Major Competitors
Applied Industrial Technologies
Kaman (Industrial Technologies Div.)
DXP Enterprises
25
Material Handling
7%
Hydraulics &
Pneumatics
12%
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
Industries Served
Equipment and Machinery
Food Products & Processing
Pulp and Paper
Iron and Steel
Fabricated Metal Products
Lumber and Wood Products
Chemical Products
Aggregate & Cement
Equipment Rentals/Leasing
Oil & Gas Extraction
Automotive
Rubber & Plastic Products26
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
Industry Trends
Index Supportive of Industry Growth
Institute for Supply Management - Purchasing Managers Index
60.2 in June
2018
50
27
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
Mfg Industrial Production +1.9% in Q2
Robust energy sector
PMI – 22 straight months of growth!
Consumer confidence remains high
Positive Indicators for our Industrial Parts Group
Our first combined Motion/EIS
distribution center in Dallas. This
collaborative effort consolidated
3 DCs and 2 branches into one
DC, creating efficiencies and a
lower cost structure.
28
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Industrial Parts Group
Growth Opportunities
Product Category Expansion
- Automation, Process Pumps, and Safety
Acquisitions
- 35% Investment in Inenco (Australia) April 2017
- Added Empire Wire and Supply, NumaticEngineering, and Apache Belts and Hose in 2017
Expansion in New Markets
Repair, Fabrication, and Assembly
E-Commerce
Vending, VMI, and Store Room Mgmt
Share Gains with Major Accounts
Only 7% share of market –
estimated at $80+ billion
29
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Business Products Group Highlights
S.P Richards is the nation’s second largest distributor of business products, office furniture, computer supplies and facilities, breakroom and safety supplies
2017 Sales at $2.0 billion; 2018 sales est. ~$2B
- 55 DC’s in U.S. and Canada
Long history of serving the independent reseller and national accounts
Access to over 98,000 products
- 850+ leading manufacturers
- Global sourcing includes nine proprietary product brands
Superior fill rates, accurate and timely shipments and competitive pricing
Database management, logistical support, e-commerce
Comprehensive array of sales, marketing and training programs
13%
30
Founded 1848
Acquired 1975
Business Products
10%
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
Quarterly Sales History
$300
$325
$350
$375
$400
$425
$450
$475
$500
-1%
-3%
-3%
-4%
-5%
+5%
Sales
Millions
-0-
+15%
2016 +2%
+4%
+22%
+17%
+14%
31
+3%
-2%
-3%+1%
+4%
+5%+9% -5%
-2%
2017 +1.5%2015 +7.5%2014 +10%2013 -3%
-0-
2018 -2%
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
Business Products Group Overview
Suppliers: Hewlett Packard, 3M, Hon, Newell, Kimberly Clark, Georgia Pacific..
Customers: Serves > 9,700 business product resellers
Primary Sales Channels
Independent
Resellers
53%
Internet Reseller
5%
Nat’l Accounts
20%
Major Competitors
Essendant
Amazon/E-tailers
Mass Merchants
Specialty Distributors
Importers
32
Alternate Channel
22%
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
PRODUCT MIX
18%
33%
35%
14%
2017
Office Supplies FBS Furniture Tech
32%
47%
8% 13%
2010
17%
27%41%
15%
2020
(Est)
Drive for Diversification
Initiatives to Diversify Product Offering are Significantly
Increasing Facility, Breakroom & Safety Supply Sales33
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
Demand Drivers Relatively Stable, but Also Mixed..
0
100
200
300
400
500
600
700
Q2'14 Q4'14 Q2'15 Q4'15 Q2'16 Q4'16 Q2'17 Q4'17 Q2'18
Service-Providing Employment
Source: BLS.gov
-4.5M in 2008/09
1M+ in 2010
2M+ in 2011 - 2017
Steady and Consistent New
Job Growth for last 6 Years
U.S. GDP and Employment Levels
~1M New Jobs YTD
in 2018
34
0.0
1.0
2.0
3.0
4.0
5.0
6.0
Q2'14 Q4'14 Q2'15 Q4'15 Q2'16 Q4'16 Q2'17 Q4'17 Q2'18
U.S. GDP (% Change)
+2.3% in 17
Source: BEA.gov
+2.4% in 14
+1.7% in 13
Tempered GDP
Growth for Several
Years
+4.1%
in Q2’18
+2.6% in 15
+1.6% in 16
June 2018
Unemployment
Rate at 3.9%
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
Announced April 12, 2018
Enhances ability to compete in $100B business products space
Stronger, more competitive national business products distribution
Maximizes value for S.P. Richards
Provides SPR combination with partner singularly focused on business products distribution market
Combined company better positioned to serve customers – benefiting all stakeholders
S.P. Richards/Essendant Merger
35
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
GPC shareholders 51% ownership combined company value creation on a tax-free basis
Significant cost & working capital synergies
Strengthens management focus & capital allocation priorities
Strengthens focus on core automotive/industrial businesses
Provides one-time ~$347M dividend
Expected to close by end of 2018
S.P. Richards/Essendant Merger
36
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
Business Products Group
Growth Opportunities
Market Share Initiatives
Product Line Expansion
New Products
Private Brand Expansion
Enhanced Dealer Services/ Marketing & Electronic Content
FBS and Alternate Channel Growth
Low percentage share of market
– estimated at $100+ billion
37
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
Drivers and Opportunities
Demand Drivers Opportunities and Initiatives
Automotive
• Total vehicles > 6 years old
• Complexity of vehicles/ # Trucks & SUV’s
• Average age of cars & light trucks
• Gas Prices/Miles driven on roads each
year
• 7.5% global market share – est. $200+ billion
• Approx. 500,000+ products & hundreds of thousands
of customers across North America, Europe & Australasia
• New distribution, commercial programs, major A/C’s, O/S
sales, connectivity, niche markets – heavy duty, imports,
paints and tools & equipment, store resets and retail
initiatives
Industrial
• Manufacturing expansion (ISM’s PMI)
• Manufacturing industrial production
• Capacity utilization rates
• Capital expenditure budgets/expansion
• Manufacturing employment in U.S.
• 7% share of market – estimated at $80+ billion
• Approx. 7.1 million products & > 300,000 customers
• Growth via product category and line expansion,
acquisitions, expansion in new markets, repair, fabrication
and assembly services, e-commerce, vending, VMI and
store room management and share gains with major
accounts
Business Products
• U.S. gross domestic product (GDP)
• White collar employment numbers
• Office occupancy rates in U.S.
• Low percentage share of market – est. $100+ billion
• More than 98,000 Products & Approx. 9,700 Customers
• Growth via market share initiatives, product line expansion
(including proprietary brands), new products, enhanced
marketing/electronic content and new or alternate channels
via FBS diversification
38
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
Q2 2018 v. Q2 '17YTD
2018v. '17
Net Sales (billions) $4.82 +18% $9.41 +18%
Net Income (millions)* $234 +23% $420 +20%
Diluted EPS* $1.59 +23% $2.85 +21%
39*Excludes transaction-related costs associated with the 2017 AAG acquisition as well as
2018 spin-off of S.P. Richards
Recent Financial Highlights
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
Strong cash position
- Above $350M+ at June 30, 2018
Prudent working capital management
- Working capital efficiency at 13.2% for YTD 2018
- 110% Accounts Payable/Inventory at June 30, 2018
- Cash conversion cycle improved to 47 days at June 30, 2018
After-tax return on invested capital (ROIC) > WACC
- ~15% ROIC YTD in 2018 Significantly exceeding 7.5% WACC
Comfortable with capital structure
- Total debt of $3.2B at June 30, 2018
- < 50% Debt to total capital; ~2.5X Debt to EBITDA
Financial Focus
Balance Sheet Highlights
40
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
0.0
5.0
10.0
15.0
20.0
25.0
30.0
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Improving W/C Efficiency Trends
23.5%
13.2%
W/C Eff.Steady and consistent improvement and
positioned to further improve with effective asset
management and sales and earnings growth
41
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
Improvement in Working Capital
42
DIO - 127
DIO - 103
DPO - 39
DPO - 104
DSO - 45
DSO - 48
20
40
60
80
100
120
140
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
DSO DIO DPO
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
…..Compressed CCC
43
CCC - 133
CCC - 47
45
55
65
75
85
95
105
115
125
135
145
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
CCC
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
6.0
7.0
8.0
9.0
10.0
11.0
12.0
13.0
14.0
15.0
16.0
17.0
18.0
Return On Invested Capital
Continue to target
investments with
> 15% ROIC
15.4%
14.9%
44
ROIC
WACC~8% Spread
8.0%
7.5%
Consistently Exceeding WACC
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
Steady and Strong Cash Flows
0
150
300
450
600
750
900
1,050
1,200
2012 2013 2014 2015 2016 2017 2018e
Free Cash Flow
Capital Expenditures
Dividend Payout
$400M
$200M
$400M
45
$1 Billion
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
Commitment to Shareholders
Priorities for Cash
Reinvestment in
Businesses
Acquisitions
Dividends
Share Repurchases
46
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
Recent Acquisitions
20155
4 Store Groups
AEA
5Miller, Oil & Gas
Lake Erie, Moss,
Connect-Air
3JAL, Dinesol
Malt
2016
11Olympus, Covs, Global,
AMX,
Auto-Camping, ASL,
5 Store Groups
6Epperson,
MO Power, Colmar,
OBBCO, Braas, CPS
2Safety Zone, RMC
Jan/San
2017
12AAG, 6 Store Groups
(+48 new stores),
Stone Truck Parts,
Welch, Sulco T&E,
autoBarn, Universal
435% Inenco
(Australia),
Numatic, Apache,
Empire
N/A
2018(thru Q2)
11Smith Auto in U.S. plus
store group expansion
in Europe
2Sterling Engineering,
Power Industries
N/A
47
$180M
$600M
$2.1B
Estimated
Annual Revenues
$60M
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
2017 Dividend Kings
AWR American States Water Company 63
DOV Dover Corporation 62
NWN Northwest Natural Gas Company 62
GPC Genuine Parts Company 61
PH Parker-Hannifin Corporation 61
PG The Procter & Gamble Company 61
EMR Emerson Electric Co. 60
MMM 3M Company 59
CINF Cincinnati Financial Corporation 57
VVC Vectren Corporation 57
CL Colgate-Palmolive Company 55
KO The Coca-Cola Company 55
JNJ Johnson & Johnson 54
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CWT California Water Service Group 50
SJW SJW Group 50
FRT Federal Realty Investment Trust 50
SWK Stanley Black & Decker 50
SCL Stepan 50
ABM ABM Industries 50
48
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
Commitment to Shareholders
0
0.5
1
1.5
2
2.5
3
2018
Dividend Record
2018 Annual Dividend $2.88
3% Yield and +7% from 2017
62 Consecutive Years of
Increased Dividends
49
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
Commitment to Shareholders
Share Repurchases History
17.4 Million Shares Remaining to be Repurchased
Consistent History Of Returning Cash To Shareholders50
(in millions) # Shares Cash Paid
1994 – 2004 24.0 $649.9
2005 – 2009 18.2 782.3
2010 – 2014 8.2 495.3
2015 3.3 292.2
2016 2.0 181.4
2017 1.9 173.5
TOTAL 57.6 $2,574.6
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
Commitment to Shareholders
5-Year Returns to Shareholders
2013 2014 2015 2016 2017
Dividends $326.2 $347.3 $368.3 $386.9 $395.5
Share
Repurchases120.6 95.9 292.3 181.4 173.5
Total 446.8 443.2 660.6 568.3 569.0
Approx. $2.7 Billion Returned to
Shareholders Over 5 Years
51
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
Our Sustainability Commitment
► LED lighting conversion
► Alternative sources
(solar, battery, wind)
► 500+ active projects
► 15 million BTU
reduction (25%)
ENERGY
► Rail vs truck conversion
(18 mpg)
► Improved fuel economy/
vehicle selection criteria
(10%)
► Route optimizations
► Millions of miles
reduced
FLEET
► Sustainability
ambassadors
► Awareness at local level
► Volunteer support
programs
► Structured give back
campaigns
COMMUNITY
► Low-flow devices
► Natural water retention
treatment vs runoff policy
► Usage reduction
programs
► Closed loop systems
WATER
► Diversion for waste
streams
► Recycle programs
at source
► Packaging
conversion/reduction
► Fiber recycle
WASTE
52
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
GPC Outlook & Objectives
• Sales Growth +13-14%
• Stabilized Operating Margin
• EPS Growth +19-22%
• Cash from Operations in
$950M-$1.0B Target Range
• Steadily Improving W/C
Efficiency
2018 Outlook
• Improve Sales by 6-8%
• Increase Operating Margin
• Grow EPS by 7-10%
• Generate Solid Cash Flows
• Maintain Strong Bal. Sheet
Key Long Term
Annual Objectives
53
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
Outlook & Objectives
2018 Outlook
Sales growth +13-14%
Stabilizing operating margin
EPS growth +19-22%
Cash from operations in $950-$1B target range
Steadily improving working capital efficiency and CCC
Key Long-termAnnual Objectives
Improve sales by 6-8%
Increase operating margin
Grow EPS by 7-10%
Generate solid cash flows
Maintain strong balance sheet
All Content is Company Confidential and Exclusive Property of Genuine Parts Company.
Thank You!
Contact Information:
Carol Yancey - EVP & CFO: 678-934-5044
Sid Jones - SVP IR: 678-934-5628